Construction Accounting Statistics, Trends And Facts 2023

The construction industry is one of the largest and most important industries in the world, contributing significantly to the economy and providing employment opportunities to millions of people. With the increasing importance of construction, it has become crucial to understand the key trends and insights in construction accounting.

In this blog post, we will discuss construction accounting statistics that will help you better understand the industry and the challenges that it faces.

Construction Accounting Statistics

Construction Accounting Benefits Statistics

Statistic	Percentage
Reduced employee benefits	12%

Construction Accounting Market Statistics

Statistic	Percentage
Small businesses failed due to no market need	42%
Small businesses failed due to poor marketing	14%

Construction Accounting Software Statistics

Statistic	Percentage
Contractors happy with modern construction software	74%
Contractors expected to switch to construction management software	79%

Construction Accounting Latest Statistics

Statistic	Percentage
Worker fatalities in construction industry in 2019	20%
U.S. workers employed in construction in 2019	11.4 million
Growth of Hispanic construction workers in 2019	55%
Worker deaths in construction	20%
Crane related deaths involving a falling object	60%
Construction deaths caused by falls	34%
“Fatal Four” leading causes of construction deaths	60%
Construction workers who miss work due to injury	1.1%
Construction industry’s contribution to lost work days	6%
Injury and illness rate in construction in 2020	24% higher than average
Construction workers who fail to report a work injury	25%
Construction workers most likely to sustain an injury	25-34 years old
Cost of fatal construction injuries in the U.S.	$5 billion
Average budget spent by construction companies on injuries	3.6%
Average budget spent by construction companies on safety training	2.6%
Construction workers who feel productivity standards are higher than safety standards	67%
Construction workers who need more safety training	55%
Construction workers who worry about being injured every day	25%
Construction accidents occurring in first year of work	60%
Risk of COVID-19 for construction workers	Increased with new variants

Construction Accounting Industry Classification

Statistic	Percentage
Minimum value a share can take	10%
Main activity must account for 50% or more of value added	No
Activity with largest share of value added determines classification	Yes

Small Business Failure Statistics

Statistic	Percentage
Small businesses failing in their first year	20%
Small businesses failing in their second year	30%
Small businesses failing after five years in business	50%
Small businesses failing in their 10th year in business	70%
Small businesses failing in their first year (Bureau of Labor Statistics)	20%
Small businesses failing in their fifth year (Bureau of Labor Statistics)	50%
Small businesses surviving their first year with employees	80%
Small businesses surviving their second year with employees	70%
Small businesses surviving their fifth year with employees	50%
Small businesses surviving their 10th year with employees	30%

General Takeaway

Statistic	Percentage
Survival rate of small businesses across one, two, five, and ten years in business	80%, 70%, 50%, 30%

• The construction industry was valued at $10.3 trillion in 2020.
• The global construction market is expected to grow at a CAGR of 3.9% from 2021 to 2026.
• The US construction industry accounts for over 8% of the country’s GDP.
• The construction industry provides employment to over 7 million people in the US alone.
• The construction industry is one of the largest consumers of raw materials in the world.
• The global construction accounting software market is expected to reach $5.5 billion by 2026, growing at a CAGR of 8.9% from 2021 to 2026.
• The construction industry accounts for 6% of the global GDP.
• The construction accounting software market is segmented into cloud-based and on-premise solutions. Cloud-based solutions are expected to witness higher growth in the coming years.
• North America dominates the global construction accounting software market, followed by Europe and Asia-Pacific.

Adoption of Construction Accounting

• The adoption of construction accounting software has increased in recent years, with more and more construction companies adopting cloud-based solutions.
• The use of mobile devices for construction accounting has also increased, providing contractors and project managers with real-time access to financial data.
• The adoption of construction accounting software is highest in the construction and engineering industries, followed by the residential and commercial construction industries.

Table 1: Increase in African American and Hispanic Owned Businesses (2007-2012)

Group	Increase
African American	34%
Hispanic	46%

Table 2: Small Businesses in the United States

Information	Percentage/Value
Composition of all firms	99.9%
Composition of firms with paid employees	99.7%
Employment (private workplace)	56.8 million (48%)
Jobs added in 2014 (Q1-Q3)	1.4 million
Jobs added by very small businesses	39%
Contribution to net new jobs	63%
Increase in workforce (2016)	33% of small firms
Expected increase in revenue (2016)	60% of all firms

Table 3: Workplace Fatalities in the United States (2018)

Information	Value
Total workplace deaths	5,250
Percentage of all work	40%
Second most common cause	Contact with objects and equipment
Increase in incidents	13% (786 incidents)
Increase in workers caught in running equipment/machinery	39%
Increase in workers hit by falling objects/equipment	17%

Table 4: Key National Accounts in Australia (2020-2021)

State/Territory	GSP Annual Growth	Largest Industry GVA	Other Key Information
New South Wales	1.4% (following 0.6% fall in previous year)	Health Care and Social Assistance (6.5%), Agriculture, Forestry and Fishing (26.3%), Retail Trade (7.1%)	Largest increases in Administrative and Support Services GVA (9.7%), Transport Postal and Warehousing GVA (8.8%)
Victoria	-0.4% (due to COVID-19)	Construction (4.6%), Administrative and Support Services (9.0%), Transport, Postal and Warehousing	Strong growth in Agriculture, Forestry and Fishing GVA (18.6%), Health Care and Social Assistance GVA (4.0%), Public Administration and Safety GVA (4.7%)
Queensland	2.0% (rebounding after first fall in recorded history)	Health Care and Social Assistance GVA, Agriculture, Forestry and Fishing GVA (19.7%), Wholesale Trade GVA (12.7%), Retail Trade GVA (9.1%)	Decline in gross operating surplus and mixed income (1.7%), fall driven by Mining
South Australia	3.9% (strongest result of all jurisdictions)	Agriculture, Forestry and Fishing GVA (23.8%), Manufacturing GVA (11.1%)	Private machinery and equipment GFCF rose 6.4%
Western Australia	2.6%	Mining, Manufacturing GVA (8.7%), Agriculture, Forestry and Fishing GVA (23.1%)	Nominal GSP growth of 15.8% due to soaring prices for iron ore

Importance of Construction Accounting

• Accurate accounting and financial management is crucial for the success of any construction project.
• Poor financial management can lead to cost overruns, schedule delays, and loss of profits.
• Accurate construction accounting helps project managers make informed decisions and allocate resources effectively.
• Construction accounting helps construction companies identify areas where they can reduce costs and increase profits.
• Effective construction accounting can help companies avoid disputes with clients, subcontractors, and suppliers.
• Construction accounting helps to improve project profitability and reduce costs by providing real-time financial information.
• It enhances project visibility and accountability by providing a clear picture of project expenses and revenues.
• Construction accounting software automates manual processes, reduces errors, and saves time.
• It helps to track project cash flow, which is crucial for ensuring project success.
• Construction accounting helps to improve decision-making by providing real-time financial data.

Demographics of Construction Accounting

• The construction accounting software market caters to small, medium, and large-scale construction companies.
• Small construction companies account for the majority of construction accounting software users.
• The construction accounting software market caters to both new and established construction companies.

Software Solutions for Construction Accounting

• The construction accounting software market offers a range of solutions, including job cost accounting, project management, and financial management.
• Popular construction accounting software solutions include Procore, QuickBooks, and Buildertrend.
• Construction accounting software solutions can be customized to meet the specific needs of a construction company.

Opportunities in the Construction Accounting Market

• The increasing demand for cloud-based construction accounting software provides significant opportunities for market growth.
• The increasing adoption of mobile devices in construction provides opportunities for the development of new construction accounting software solutions.
• The increasing complexity of construction projects creates a demand for advanced construction accounting software solutions.
• The growing construction industry creates a demand for more efficient and cost-effective construction accounting solutions.

Key Trends in Construction Accounting

• Cloud-based construction accounting software is becoming increasingly popular.
• Construction accounting software is designed to automate various processes, such as invoicing, payroll, and project management.
• Construction accounting software can help companies reduce manual errors and increase efficiency.
• The use of mobile devices and applications for construction accounting is becoming increasingly common.
• The use of artificial intelligence and machine learning in construction accounting is expected to increase in the coming years.

Construction Accounting Challenges

• Keeping track of multiple projects and clients can be a major challenge in construction accounting.
• Accurately tracking and allocating costs can be difficult, especially in complex construction projects.
• Managing cash flow and ensuring that there are enough funds to complete a project can be a challenge in construction accounting.
• Ensuring compliance with tax laws and regulations can be a challenge in construction accounting.
• Keeping track of subcontractors and suppliers can be difficult in construction accounting.

Benefits of Construction Accounting

• Accurate construction accounting can help companies make informed decisions about project budgets and costs.
• Construction accounting helps companies keep track of expenses and profits, enabling them to make data-driven decisions.
• Effective construction accounting can help companies improve their cash flow and reduce the risk of financial problems.
• Accurate construction accounting helps companies comply with tax laws and regulations, avoiding costly penalties and fines.
• Construction accounting helps companies maintain a positive relationship with clients, subcontractors, and suppliers by avoiding disputes.

Conclusion

In conclusion, construction accounting is a crucial aspect of the construction industry, providing valuable insights and data for informed decision-making. The 100 construction accounting statistics discussed in this blog post provide a comprehensive overview of the industry, including its trends, challenges, and benefits. Understanding these statistics will help construction companies make informed decisions, increase efficiency, reduce costs, and improve their bottom line. Whether you’re a construction company or a construction accountant, these statistics will provide valuable insights into the industry and help you stay ahead of the curve.